Court Rejects First Foreign Lawsuits Against Tobacco Companies
LOUISVILLE, Ky., Dec. 30 /PRNewswire/ -- Brown & Williamson Tobacco Corporation today issued the following:
A Washington, D.C. federal court judge today rejected efforts by the Republic of Guatemala to hold tobacco companies liable for reimbursement of
The Guatemala litigation is the first of a number of pending foreign lawsuits against tobacco companies to be decided by U.S. courts.
Refusing to allow Guatemala's lawsuit to go to trial, U.S. District Judge Paul Friedman held that U.S. laws bar third parties, like foreign governments, from recouping costs on behalf of individuals allegedly injured by smoking.
In his ruling, Judge Friedman said that the ``plaintiff's claims are simply too remote, contingent, derivative and indirect to survive.''
The court's decision to disallow the lawsuit is considered key to future court actions in related lawsuits filed by other foreign governments against tobacco companies. In addition to Guatemala's lawsuit, the Washington, D.C. federal court has before it lawsuits brought by the governments of Bolivia, Venezuela, Ukraine, and Nicaragua. Claims against tobacco companies filed by Panama, and the Brazilian State of Rio de Janeiro are pending in state courts.
``The dismissal of Guatemala's lawsuit sends a strong message to foreign governments and enterprising plaintiffs' attorneys that litigation mania in the United States has gone far enough,'' said Ken Bass, an attorney representing Brown & Williamson Tobacco Corporation.
``The foreign lawsuits were doomed from the beginning, based on established U.S. law and reaffirmation of those laws by numerous courts across the country,'' Bass said.
Guatemala's claims were patterned after similarly-framed unsuccessful lawsuits brought by numerous union health funds that claimed they were entitled to recover payments made to members for alleged smoking related illnesses. To date, all of those so-called ``medical cost recoupment'' lawsuits reviewed by the courts -- both at the lower and appellate levels -- have been decided in favor of tobacco industry defendants.
In dismissing the litigation, the courts have cited established law that prohibits third parties, like foreign governments, from recovering health- related payments because any alleged damages to the third parties are ``too remote'' to the plaintiffs and disregard any specific injuries allegedly suffered by an individual.
The courts also have applied the ``remoteness'' principle to claims that the third parties were injured by alleged wrongful conduct of tobacco companies. Guatemala, like the union health care funds, was claiming damages based on U.S. racketeering and anti-trust laws.
Brown & Williamson said that had the case gone forward, an extensive discovery review of Guatemalan government records would have shown that the Republic could not have incurred damages because of the substantial financial benefits the country derives from taxes on lawful cigarette commerce.
Brown & Williamson Tobacco Corporation is headquartered in Louisville, Ky. The company's major brands include KOOL, LUCKY STRIKE, CARLTON, CAPRI, GPC, MISTY and VICEROY.